(and never get stuck with non-paying clients again)
You may not know me because this is my first post to a blog.
My name is Kathy O’Connell and I own and run CPASiteSolutions with my husband Brian. I’m also a practicing CPA. I’ve had my firm for over 12 years now. In that time I’ve learned a lot of strategies, techniques, and "best practices" that have enabled me to build a very profitable practice while spending less than 20 hours a week in it.
Brian has asked me to share with you a few of the strategies that have enabled me to get paid more while spending less time working in my firm.
So here’s the first one…
As you’ll see, when I finally snapped and applied this strategy, I instantly increased my cash flow, made my firm run smoother, and eliminated 16 hours of administrative work a month.
How I went from waisting time to getting paid on-time every time.
I don’t know about you but nothing pisses me off more than having to chase down slow payers.
After all, I work hard to complete their work on-time, so I resent it when they don’t pay me on time.
I don’t string them along. I make sure I get their work done on their deadline, even if it means working late or weekends.
In the past, I would promptly print the invoices, stuff and label envelopes, pay the postage and mail them out… Then, I waited. Some of my clients would pay me right away. (I loved those guys)
But some of my clients string me along for months.
So, for those guys I had to print and mail a second and often a third notice.
What a WASTE OF TIME!
I was not making any more money chasing down slow payers. Even with Janice, my office manager, doing the work, it was still a waste of time and effort. And Janice was so busy she often "dropped the ball" in her other responsibilities.
Some clients paid after receiving our "Second Notice" or "Third Notice". (It seems I had trained them to ignore my first invoices and just pay me when they saw my "Third and Final Notice" stamp on their invoice.)
There were still clients who hadn’t paid me after our third notice. By this time it’s a full 60 days after I’ve completed the work.
Finally, Janice had to call them (there is no way I’m making those collection calls), and she complained because it was a horrid job. She called and called, got voicemail, no returned calls or worse yet, the run around by my client’s secretaries.
Eventually, after many wasted "non-billable" hours, we would get a few more payments.
But, Not all of them.
Sometimes, no matter how hard we tried, we didn’t get paid. And, nothing infuriates me more than getting screwed out of a bill by a client.
Not only have I wasted time doing their work, but I’ve wasted a ton of money tracking them down trying to get paid.
When Janice used to tell me that we can’t collect from a client, I’d get in this nasty foul mood for hours.
Finally one day after getting the news that one of my bigger clients just wasn’t going to pay me, I snapped.
And after a tirade and a half, I went home and decided I’ve had it.
I decided that I’m simply not willing to go the work if I’m not absolutely assured that I’m going to get paid. And I’m not going to go through this invoicing and collection BS anymore.
How I Turned It All Around
It occurred to me that I pay for so many things with my credit card, why couldn’t my clients pay me with their credit card. That way if they were short on cash, I still get paid. I’m not the one issuing credit anymore, their credit card company is.
That’s when I decided that I would not invoice another client again.
Now, I simply take their credit card numbers before I start their work. Then, as soon as I complete their job, I charge their card and I’m paid instantly.
I can’t fully describe the difference it’s made.
The biggest difference is how much more I enjoy my practice.
With the weight of collections off my shoulders, I am enjoying my practice again. It’s so freeing not to worry about whether or when I’m going to get paid.
Janice is thrilled. No more sending second and third notices. And better yet, no more collection calls. My office runs more smoothly now that Janice has time to help me with client work and the other once neglected office tasks.
If you are not having your clients pay you by credit card now, I highly recommend that you do so.
If you want to see how easy it is, just start offering your clients the option to pay with a credit card. You’ll find that there are a number of clients who prefer it. After all it’s easier for them and they get to earn frequent flier miles in the process.
Ok, let me give you one more recommendation…
I spent hours researching merchant processors (the companies that allows you to accept credit cards). And believe me they are all not alike. There are some real sharks out there. The rates vary widely. I found the lowest discount rates are around 1.67 percent. But then you need to look at the "other fees" like transaction fees (that vary from $.20 to $.30), monthly fees (that vary from $0 to $20), and the biggest one is equipment leasing fees (that range from $0 to $149 a month).
So after a long time searching the Internet and calling to uncover the "other fees" I found a truly outstanding merchant processor. These guys have the lowest discount rates (1.67%). The lowest transaction fee ($.20). And best of all, absolutely no leasing fees. They actually gave me a brand new card swiping machine for free.
I thought that this is too good to be true so I did some more research on the company. It turns out that they are one of the top 5 merchant processors in the United States. I even went so far as to check their financials. And they are rock-solid.
If you’d like to find out more about this company, the best person to contact is my friend Keith Day. Please email him and he’ll send you all the details or simply give him a quick call. He was very patient with me and answered all my annoying questions.
His number is 888-423-1116 Ext. 1
or email him at lkeithday@bizology.net
Good luck incorporating my hard won learnings into your own practice.